Nova Scotia Premier Stephen McNeil talks with reporters after addressing a business lunch in Halifax on Tuesday.

The changes announced earlier this month in the federal budget will harm provincial literacy programs and won’t work for businesses in the province, McNeil said Tuesday after a speech to the Halifax Chamber of Commerce.

“We also believe that the Canada Job Grant doesn’t work for Nova Scotia companies and we’ve heard it loud and clear,” McNeil said. “This absolutely makes no sense.”

The proposed grant initially offered $15,000 for each eligible worker to be divided equally among Ottawa, the provinces and employers. But Ottawa has faced intense criticism that the program would siphon federal cash from existing provincially run programs for youth, aboriginals and disabled workers.

“We’ve clearly stated that we’re not happy,” McNeil said. “The Canada Job Grant program will cause organizations that are providing literacy programs and life skills to Nova Scotians to be really put under pressure. It’s a substantial amount of money.”

The federal government has since said it will cover the provincial share and deliver the program on its own if it can’t reach a deal with the provinces by April 1.

However, Employment Minister Jason Kenney has stressed that Ottawa’s preference is to reach an agreement in ongoing talks with the provinces and territories. A spokeswoman for Kenney said Tuesday that the Canada Job Grant also has the support of unions, employer associations and educators across the country.

Still, the latest proposal has caused fresh indignation in Quebec, where the Harper government has been accused of encroaching on provincial turf. Quebec Premier Pauline Marois has accused Ottawa of acting like a “real predator.”

Ontario, Alberta and the other Atlantic premiers have all expressed varying reservations about the proposed program.

In Charlottetown, Prince Edward Island Finance Minister Wes Sheridan has said more negotiations are needed.

McNeil said Nova Scotia can’t afford to pick up the fiscal slack if Ottawa reduces its support for certain programs.

“We can’t pick up all of the places where the federal government is divesting themselves of their responsibility,” the Liberal premier said. “We’re running a deficit now, a substantial one.”